the psychology of money

The Book that Will Change your Concept of Money💸

Doing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people. The Psychology of Money will change your concept of money💸.

In this post, the lessons you will learn after reading this book. How should you behave towards money?

The Psychology of Money

We’ve always talked about money as numbers, maths… something we could put in a spreadsheet and let us do the work for us.

Money is all around us. You work for money, you buy with money, and you live through money. It’s an essential component of your life, hence you need in order to survive, evolve, and enjoy your life.


Doing well with money is not about what you know. It's about how you behave.

Money is not all rational. Rather, emotions and personal behaviour affect the way you think about money.

In The Psychology of Money, Morgan Housel shares 19 stories to make you think on the way you behave towards money.

This book will teach you how to gain, manage, and make better sense of one of life’s most important topics; money.


Why Should you Read the Psychology of Money?

You can read all the books about money that you want, but they all treat money from the same point of view.

Everyone thinks money as a solely math-based entity. Formula here, formula there… and you have yoru resulting money in your pocket.

Risk assesment here, risk assesment there… and you can predict the risk of losing money in the next 5 years.

While this is all true, there’s a big emotional component within money. Being wealthy is not about how much you know, but your behaviour and sense of money.


This book gives you a different perspective to tackle and understand how money works.

No numbers, no formulas… only behaviours and common sense traits.

There are thousands of books talking about finances, but The Psychology of Money is different. This book is one of a kind, and you should give it a read.

The Lessons You’ll Learn in the Psychology of Money

Plan your Own Game

Money is very individual. What works for them may not work for you.

Your financial strategy must meet your needs and goals.

How much are you willing to risk? With how much money do you feel comfortable? Are you looking for the short- or long-term?

The answer to these questions will vary depending on who answers. Copying your financial strategy from someone else is not the way to go.

Don’t compare your financial strategy with others. Plays your own game.

Nothing is as Good or Bad as It Seems

You can win the lotto, or go bankrupt. But nothing is as good or bad as it seems.

The luck component is present, and you shouldn’t understimate it. It may bring you a lot of luck, or throw you to the wolves.

Either way, luck doesn’t form part of your behaviour and decisions. As luck acts over your money, you’ll be able to react to it and strengthen your financial strategy.

Learn from experiences. Nothing is as good or bad as it seems

It’s Enough

Money involves risks you may not be willing to take.

Depending on the game you are playing, you may be exposed to big risks that make you uncomfortable and uncertain.

Your financial strategy should let you sleep deep and tight every night. If it doesn’t, you are taking too many risks.

Find your “it’s enough”. Know where your limits are, and don’t take risks beyond that.

Time is the Main Driving Force of Money


Money is like bamboo

You plant the seed, water it, and nothing will grow for the first years. It’s creating a huge and stable root network to attach firmly to the ground and be safe.

Suddenly, the bamboo starts to grow in a tremendous fast rate. Before you notice, what took seven years to grow it’s not increasing in height in an exponential manner.

Money behaves the same way. Time and compounding are the main driving force of money.

Be constant, determined, and you won’t have any problem reaching wealth. The habits and long term are key for success

Be Reasonable Rather than Rational

You can’t explain everything around money based on pure rational thinking. Rather, your emotions and irrational mind have a word to say in your finances.

Don’t look at numbers as rational numbers. Instead, be reasonable and follow your instincts to lead your financial strategy to suit your needs and goals

You don’t need to be always right

Money and finances require of a lot of small decisions in your every day life.

Wealth is defined as the accumulation of good choices, not the number of bad choices made along the way.

It doesn’t matter if you make the wrong choice now. If everything else goes according to your financial strategy, you’ll still be in a favourable spot to become wealthy and reach your goals

Use Money to Buy Freedom

Taken from Rich Dad Poor Dad, you should have money working for you, rather than work for money.

Make money your workhorse towards freedom. Use money to buy time, as this is the only and most valuable asset in your life.

Reaching the acclaimed financial freedom takes time, but it is possible.

Use money to buy freedom

Save Money

This is one of the most essential messages of Psychology Of Money: Save money, even when there’s no reason to do so.

The future is unpredictable, and we tend to spend money on unnecessary and useless things.

Spend the money you need to be happy and live a comfortable life, and save the rest.

Invest it on the long term, drive compounding to increase your portfolio, and save it. This will give you room for error and calm to your financial life.

Avoid Extreme Financial Commitment

Your financial strategy should let you sleep every night. If you take too many risks and commit your entire life to your financial decisions, you won’t be able to sleep overnight.

If you like taking risks, do so. But don’t put into play essential parts of your life to increase your wealth by a tiny bit.

Ask yourself; is it worth it? Is the return going to be bigger than the risk?

Is The Psychology of Money For You?

There are many books out there talking about finances and telling you how to manage your money.

But only a few are worth a read…. and this is definitely one of them.

With The Psychology of Money, Morgan Housel accomplished something very few people has been able to achieve; humanize money.

After reading The Psychology of Money, your perspective towards money will change. Instead of numbers and rationality, money will now be emotions, irrationality, and instincts

Is the Psychology of Money for Me?

If you are looking for financial education, this book is for you.

If you want learn about how peoplle behave in regards to money, this book is for you

If you are interested on human psychology and behaviour, this book is for you

If you want to have fun while expanding your common knowledge, this book is for you


The Psychology of Money delivers a disruptive and innovative message in regards to money and finances. Instead of maths and numbers, money is now emotions, common sense, and instincts.

One of these ‘must-reads’ for those looking for financial advise, continuous improvement, and better management of their finances.

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